[R]12:00AM New York - U.S. retailer reported full-year net earnings increased 5.5% from $678 million a year ago to $715 million as same store sales advanced 3.9%.[/R]

Quarterly Earnings Review

Nordstrom Inc. reported fourth quarter sales fell 4.4% from $2.6 billion a year ago to $2.5 billion as the company continued to align inventory with sales trends.

For the quarter ended December 31st, total earnings declined to $212 million from $232 million in the comparable period a year ago. Earnings per share fell to $0.92 per share from $0.89 per share last year.

Gross profit in the period fell to $945 million from $1 billion a year earlier. The company reported dividend in the quarter increased from $0.13 per share to $0.16 per share.

Annual Earnings Review

Nordstrom reported that total sales in the full-year ended December 31st advanced 3.1% to $8.8 billion from $8.6 billion a year ago.

Net earnings for the year rose 5.5% to $715 million from $678 million a year earlier. Diluted earnings per share also increased from $2.55 per share to $2.88 per share.

Gross profit for the year gained to $3.3 billion in 2007 from $3.2 billion a year ago.

Revenues

In the fourth quarter same store sales plunged 0.7%, while merchandise categories with performance above the same store average were designer products across categories, accessories and women shoes.

Merchandise margins declined over prior year as the company continued to align inventory with sales trends.

The company’s year-end inventory per square foot slowed to $47, from $49 a year earlier.

During the quarter, Nordstrom repurchased 11 million shares topping $388 million, with an average price of $34.38. The share repurchases had a $0.01 impact on fourth quarter earnings per diluted share.

For the year, Nordstrom continued with its expansion plans and opened a new 165,000-square-foot full-line store at Aventura Mall in Aventura.

In addition, the company is planning to open the newly relocated full-line store at the Tacoma Mall in Tacoma, Washington.

Other stores to be opened this year include two new Rack stores at the Springbrook Prairie Pavilion in Naperville, Ill., and the Laguna Hills Mall in Laguna Hills, California.